Truss and Kwarteng to meet fiscal watchdog today after MPs demand full economic forecast

Business

Liz Truss will meet the head of the UK’s independent fiscal watchdog today after a powerful group of cross-party MPs demanded the chancellor release a full economic forecast by the end of October – a month earlier than planned.

Chancellor Kwasi Kwarteng will join the prime minister as they meet the Office for Budget Responsibility’s Richard Hughes before they are handed a first draft of its full fiscal forecasts next week.

The Treasury confirmed to Sky News the meeting is happening but would not comment on the fact it is highly unusual for a PM to attend an OBR meeting.

They also denied it was an emergency meeting.

A Treasury spokesman said: “We are committed to working with the OBR.”

The news that the pair will be having a meeting with the OBR came just hours after the Treasury Select Committee, made up of MPs from all parties, demanded Mr Kwarteng release a full economic forecast from the OBR by the end of October and bring forward his medium-term budget from 23 November.

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Mel Stride, Tory chair of the committee, had said in his letter to the chancellor it is “hard to conclude other than that an absence of a forecast has in some part driven the lack of confidence in markets”.

He added: “Some have formed the unfortunate impression that the government may be seeking to avoid scrutiny, possibly on account of expecting the OBR forecast to be unsupportive of the achievement of the economic outcomes the government expects from the Growth Plan, including 2.5% trend growth in the medium term.”

Mr Kwarteng had said the forecast would be released on 23 November but after last Friday’s mini-budget caused economic turmoil for the UK, the committee discovered the chancellor will be getting an initial OBR forecast on 7 October.

They asked him to publish “without delay” the initial economic and fiscal forecast the OBR provided to him when he started the job a few weeks ago.

A reply from the chancellor has been requested for no later than Monday.

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Senior Tory blames mini-budget for turmoil

Mr Stride also expressed frustration in his letter at having pressed Mr Kwarteng and his predecessor Nadhim Zahawi to publish an OBR forecast before the mini-budget and said the OBR had assured him on 26 August they could produce a forecast to that timescale and had already been working on it for a month.

“The OBR was standing by ready to provide a meaningful forecast alongside the 23 September statement had the Treasury requested it. No such request was received,” Mr Stride said.

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Mr Stride said he was pleased to see the OBR meeting happening.

“The PM and the chancellor must use this meeting as a reset moment – an opportunity to urgently bring forward the OBR forecast incorporating credible new fiscal rules and a plan which the OBR assesses as having a good chance of meeting them.

“Then we can all take a deep breath and start to move forward with greater confidence.”

The senior Tory told Sky News’ Daily Podcast earlier on Thursday: “Many colleagues are very concerned, and I think that’s totally unsurprising.

“I mean, I can speak for myself. I’m on the record as saying that I think if we’re not very careful, then our position as being the party of sound money and economic responsibility, fiscal responsibility, may be in jeopardy.”

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Chancellor ‘sticking with growth plan’

He added that he did not think it was incompetence that caused the current problems and suspects “some of those involved have been taken slightly by surprise how quickly the markets turned” but he thinks publishing an OBR forecast would be central to calming the markets by “demonstrating credibility”.

Liz Truss and Mr Kwarteng have today been defending the mini-budget, with the prime minister insisting the government took “decisive action” that will aid growth.

The chancellor said the plan is aimed at “protecting people right across the country” and was “absolutely essential” for growth.

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